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Recollected Questions BFM | Caiib Study Material

Bank Finance Management

Caiib Previous Year Questions




ABC Bank has the following re-pricing assets and liabilities (Rs. in crores):


Call Money - 500
Cash Credit Loans - 400
Cash in Hand - 100
Saving Bank - 500
FD - 500
Current Depost - 200


There is a reduction in rate of interest by 0.5% in call rates, 1% for CC, 0.1% for SB and 0.8% for FD.


Now, answer the following based on the above information.


1. What is the adjusted gap in re-pricing assets and liabilities?


a. 100 Cr
b. 120 Cr
c. 140 Cr
d. 160 Cr


Ans - a


Adjusted gap :


= (SB+FD) - (Call money+CC)
= (500 + 500) - (500 + 400)
= Rs.100cr (assets are less than liabilities. Hence negative gap).


The cash in hand and current account deposits are not subject to re-pricing, Hence these have been ignored.


2. Calculate the amount of repricing assets as per the standard gap method in repricing assets and liabilities.


a. 300 Cr
b. 450 Cr
c. 650 Cr
d. 800 Cr


Ans - c


Call money 500 * 50% = Rs.250cr + Cash credit 400 * 100% = 400cr Total = 650cr


3. Calculate the amount of repricing liabilities as per the standard gap method in repricing assets and liabilities.


a. 300 Cr
b. 450 Cr
c. 650 Cr
d. 800 Cr


Ans - b


Explanation:SB 500 * 10% = 50cr + FD 500 * 80% = 400cr Total = 450cr


4. What is the standard gap of the bank in repricing assets and liabilities?


a. 100 Cr
b. 200 Cr
c. 300 Cr
d. 400 Cr


Ans - b


Assets :


Call money 500 * 50% = Rs.250cr + Cash credit 400 * 100% = 400cr
Total = 650cr


Liabilities :


SB 500 * 10% = 50cr + FD 500 * 80% = 400cr
Total = 450cr


Net change = 650 - 450 = Rs.200cr positive
.............................................


All demand bills in foreign currency drawn under and import LC will be crystalised into Rupee liability on th day from the date of receipt of document.


a. 10
b. 7
c. 15
d. 30


Ans - c
.............................................


We issued the L/C as follows: L/C expired: Dec 27, 2018 at beneficiary’s country Latest shipment date: Dec 06, 2018 Period of presentation: documents to be presented within 21 days after date of shipment but within the validity of credit, state documents acceptable. Which of the following is acceptable?


a. B/L on board date: Dec 01, 2018, all documents presented on Dec 25, 2018
b. B/L on board date: Dec 01, 2018, all documents presented on Dec 31, 2018
c. B/L on board date: Dec 10, 2018, all documents presented on Dec 25, 2018
d. B/L on board date: Dec 01, 2018, all documents presented on Dec 15, 2018


Ans - d
.............................................


In which type of accounts of NRI, joint account can be opened with resident?


a. FCNR
b. NRE
c. NRO
d. Any of the above


Ans - c
.............................................


A derivatives contract cannot exist without an ......


a. Exchange
b. Underlying be it equity, interest rate etc.
c. increase in volatility
d. increase in arbitrage


Ans - b
.............................................


A quotation in which the home currency unit is the standard unit and the rate is expressed in variable units of foreign currency is called ......


a. direct rate
b. spot rate
c. indirect rate
d. forward rate


Ans - c
.............................................


NSCCL monitors positions of trading members ......


a. Offline
b. End of the day
c. Once a week
d. Online


Ans - d
.............................................


How much foreign exchange can be drawn in a financial year for Foreign Visits / Travel Abroad for the following purposes?


1. As gift to a person residing outside India or as a donation to an organization outside India


a. USD 3000
b. USD 5000
c. USD 10000
d. USD 250,000


Ans - d


2. A person going abroad for employment


a. USD 3000
b. USD 5000
c. USD 10000
d. USD 250,000


Ans - d


3. A person who wants to emigrate


a. USD 3000
b. USD 5000
c. USD 10000
d. USD 250,000


Ans - d


4. For study abroad without any estimate from the foreign University


a. USD 3000
b. USD 5000
c. USD 10000
d. USD 250,000


Ans - d


5. A person going abroad for medical treatment


a. USD 3000
b. USD 5000
c. USD 10000
d. USD 250,000


Ans - d


6. Towards maintenance of close relatives abroad


a. USD 3000
b. USD 5000
c. USD 10000
d. USD 250,000


Ans - d


7. For business purpose


a. USD 3000
b. USD 5000
c. USD 10000
d. USD 250,000


Ans - d
.............................................


Answer the following questions are based on the below given information


a. USD-INR spot and forward rate
Spot USD - 65.60/62
O/N - 1/2
TOM - 2/3
2 weeks - 7/8
1 month - 15/17
2 months - 31/33
3 months - 47/50
6 months - 95/100


b. The AD loads margin of 10 paisa for purchase transactions and 12 paisa for sale transactions


1. What is the rate at which AD can buy spot dollars from market?


a. 65.59
b. 65.60
c. 65.61
d. 65.62


Ans - b
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2. What is the rate at which AD may sell spot dollars in the market?


a. 65.59
b. 65.60
c. 65.61
d. 65.62


Ans - d
.............................................


3. AD purchases USD 100,000 in a merchant transaction and sells them in the market at 65.63 per dollar. What is the profit that AD earns in the transaction?


a. 10,000
b. USD 10,000
c. 3,000
d. 1,000


Ans - a
.............................................


4. AD sold 1 month forward USD 500,000 to a merchant and then covered up his position by buying in the market one month forward dollars at 65.82 per dollar. What is the profit/loss in the transaction?


a. Profit of 15,000
b. Profit of 35,000
c. Loss of 15,000
d. Loss of 35,000


Ans - b
.............................................


5. What rate the AD will quote for bill buying for a bill maturing in 60 days drawn in USD?


a. 65.50
b. 65.74
c. 65.81
d. 65.84


Ans - c
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